Introduction
As parents, we want the best for our children-I say we because I’m a parent (and we’re in this together and I take pride to ensuring my children are well taken care of but April 2020 I realized I wasn’t protecting them at all when I was on the hospital bed in the ER gasping for air and clenching my chest-diagnosed with pulmonary embolism (multiple blood clots in both lungs) without life insurance or a savings plan for them. I know death is the last thing we want to think about, but in reality we do not have any control when and where it comes upon us and in that moment I was grateful that I survived, but I was in tears because if I didn’t I would have put my children and family in a bind with no money or no plan and that broke my heart. You’re reading this post because you are curious to know hmm what is the best financial investment for my child (ren), so congratulations for being brave enough to take the step to protect your legacy. In this post, I’m not going to tell you the best financial investment for a child, hold on stay put because this is valuable information, and the reason being is the word “best” is subjective, but I will walk you through 4 features to look for to help you identify if a potential financial strategy makes sense for you and your child (ren).
What is a financial investment?
A financial investment is a type of asset of your choosing that you contribute money to with the expectations that the asset (s) will grow at a much higher rate than that amount you put in. For example, in a savings account we look for the most competitive APY (annual percentage yield) rates “aka interest accumulation in one year” because we want to know how much more will our savings account grow, not including what is contributed by us-no one wants to put in for an investment and expect to get the same amount we contributed back. We expect the amount we contributed PLUS even more.
Features of a Solid Investment Strategy
Flexibility
Financially one minute we may be up, the next we’re down, and the other times we’re somewhere in between. Life happens. As mothers, our life circumstances can change, so to be tied down to one specific strategy for years to come may be asking too much. To consider an investment that allows for flexibility such as (indexed universal life), to accommodate life changes/circumstances; meaning initially being able to contribute $3500 a year to your investment was ideal but life made a turned where now you may only can contribute $1500, then life changed again where business and/or career is booming, so now you would like to contribute $6,000 a year towards your investment strategy. Flexibility gives peace of mind knowing that no matter the circumstance. Ask questions and review contracts to determine if and how flexibility is allowed when deciding which investment strategy is right for your child (ren) and family needs.
Market Protection
“I’m going to invest $500 and I don’t care if I lose the $500; I’m willing to take that risk” says no one ever! Ok, maybe some people may say who has it to lose, but I’m talking to mothers. As a mother myself, I don’t have $500 to lose; that $500 could go towards groceries for my household, speech therapy for my youngest son, tutoring services for my oldest son, or maybe spa and brunch for some me time, but definitely not in the trash “because that’s what I think when it’s lost in the market such as stocks and real estate for example. Now I’m not telling you to not invest in the stock market “because I’m Pro Multiple Streams of Income and Team Generational Wealth” but I’m telling you to diligently research and understand and manage risks with investments where you can lose your principal; there can be great investments in those markets. An investment strategy for your child (ren) (such as indexed universal life) that is protected against the market downside but benefits the market upside is music to mothers’ ears who don’t like risking their hard earned money, meaning an investment that increases in growth during those great accumulation years, but does not fall in the negative during those year where losses happened-therefore my principal “aka the money I contributed, in our above example the $500” is protected.
Compound Interest
Let’s go to scripture: Matthew 14:13-20 when Jesus fed 5,000 men with only five loaves of bread and two fish; now that’s miraculous that Jesus doesn’t add he multiplies and that’s how you want compound interest to work in your favor. Compound interest is interest accumulated from a principal sum/or money you saved “use of the $500 example” and previously accumulated interest/interest you earn along the way. In other words, stacking up interest as you save and the more you save, the more compound interest. Let’s say $500 a month contributed with an annual total of $6000, in 5 years if you continue with the same contribution of $6000 yearly, your account value is now $35,000 when you only contributed $30,000 over 5 years-the difference of $5,000 is the compound interest.
The difference is to get what you desire and pray for in life, you have to have faith and obey God, but with compound interest, it will work in your favor regardless, you just have to find the right strategy where your money works for you with the magic of compound interest and not you working for the money. I’ve heard Cash is King, Credit is King, but here I want to say Compound Interest is King or in this case Queen!
Simplicity
As mothers, we are busy. We have careers, children, husbands or wives, household chores, children’s extracurricular activities and so much more. The last thing we want to do is add more chaos or complexity to our lives, so choose an investment strategy that is simple yet powerful. Everyone defines simplicity differently; what may be complex to one person may be simple to another and vice versa, so implementing an investment strategy that can fit in your existing lifestyle that requires minimal learning and understanding. Knowing the ins and out of where your money is going, how your money is growing, and how you can access your money with ease. It can also be beneficial to talk with an independent financial advisor or broker (such as myself) who is accessible, transparent, and able to communicate effectively.
Let’s Engage
Now, that we covered 4 features of a solid financial investment, which one stands out to you? Tell me in the comments section.
Conclusion:
Let us pray: Lord thank you for bringing this amazing mother on this blog post. I pray that the information learned today benefited her in a life-changing way. Protect her, guide her, and give her clarity in her decision making. In Jesus Name Amen!
Verse of the blog: Proverbs 13:22 “A good person leaves an inheritance for their children’s children, but a sinner’s wealth is stored up for the righteous.”
Contact Information That May Interest You
I would love to continue our conversation. If you’re up to it, I invite you to chat with me further and let’s talk about what’s important to you with your family financial planning.
Booking link: https://calendly.com/speakgenwealth/45min
My name is “Kim”berly Jones, a financial advisor for mothers who specializes in indexed universal life, term life insurance, and annuities. Learn more about my brand’s mission, vision, and values at: www.speakgenwealth.comhttps://speakgenwealth.com/about
Join the Speak Gen Wealth community Email Newsletter where I share news about nonprofits organizations I give back to and my signature referral program:
